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This document summarises responses to the consultation on the tax treatment of heated tobacco products. It also provides the government response, indicating an intention to create a new excise category for heated tobacco products.
Budget 2016 announced that the government would consult on the tax treatment of heated tobacco products, which are being promoted as a new innovation in the tobacco market. In these products processed tobacco is heated (but not burned like conventional tobacco) to produce, or flavour vapour. Unlike e-cigarettes, they do contain tobacco. Heated tobacco is not a separate category in its own right in current legislation, so a consultation on their tax treatment aims to help maintain the integrity of the duty system going forward.